The boundaries and changes in the banking sector
Fintech has been the digital challenger to banks. However, examples of boundaries that exist and prevent the experiencing of full benefits of the technological disruption are geography, centralization, decentralization, government and individuality. These are just a few of what needs to be eliminated in addition to boundaries of funding, not having full standardization, and also mindset.
Typically, disruptions change how people need to look at things, and so making it mainstream is important. Within the banking sector, Fintech has helped banks and banks have helped Fintechs as it has been a gateway to try and experiment things in the industry. Speed and ease have been transformed over the past 20 years with the disruption of Fintech in the banking sector. This has created issues of instantaneous gratification which has also led to vulnerability and security issues.
Is elimination good or bad?
As discussed by the panel, it is a good one for Fintechs and Banks. It is good for consumers too because it gives them more choice and brings the product closer to them in relation to proximity. We just need to guard ourselves with regulation. Fintech has also made financial literacy or education more understandable to the public.
How will regulation help?
A lot has been done by regulators and there is still more to be done. One of the issues is fear of regulators which should not be; they must rather be talked to and educated to make it easier for everyone. The UK for example has a very good regulatory system making it one of the top Fintech countries in the world. To fully utilize the benefits of regulations in Fintech, there is a need to have a change of mindset as well.
The role of big incumbents as Fintech Challengers
Big incumbents have bigger data and market share and so they need to reunite amongst themselves, have more partnerships and also to lead by example.
Now the crystal ball….
The future will see boundaries being eliminated in the innovative disruption space – Fintech. Technology will continue to change how we live, work, consume and in totality how we exist. Some of the exciting areas that will see elimination of boundaries are:
- Use of data to enhance customer experience
- Open banking
- Quantum Computing
- More investment
A recap of this panel session, join us for more on day 4 of the Fintech Week London on 15th July 2021.